New US-Cuba trade rules delayed, possibly until 2018

The 90-day period in which U.S. President Donald Trump pledged to alter trade regulations with Cuba expired in mid-September, and private industry and State Department officials have no indication when changes will be announced.

Nor has Washington met a promised 30-day deadline to “initiate a process to adjust current regulations regarding transactions with Cuba,” kicking off that 90-day redefinition.

“This process is still actively under way, and while we don’t have a specific date yet for when those revised regulations will be publicly released, we anticipate it will be in the coming months,” a Treasury Department official, asking anonymity, told the Cayman Compass.

“We will issue a public announcement and guidance on our website once the regulations are released,” he said, specifying that both Treasury and the Department of Commerce’s Office of Foreign Asset Control “will roll out the new regulations at the same time.”

In June 16 remarks in Miami, President Trump vowed to roll back Obama-era trade rules, calling the former president’s 2014 opening to Havana a “terrible and misguided deal.”

“We will not be silent in the face of communist oppression any longer,” Mr. Trump told a “Little Havana” crowd in Miami. “Effective immediately, I am canceling the last administration’s completely one-sided deal with Cuba.”

However, Cuba-trade experts say there has been little indication of what the changes might be or when they will become effective.

Emilio Morales, CEO and president of The Havana Consulting Group in Miami told the Compass his company “has not been disclosed anything about the measures. We, like you, are waiting for the announcement.”

The Havana Consulting Group, founded 20 years ago, is “a consulting firm focusing primarily on the Cuban economy and on the Cuban market,” according to its website.

Washington-based law firm Greenberg Traurig, adviser to The Havana Consulting Group and to the Washington-based U.S.-Cuba Chamber of Commerce, will offer an Oct. 27 seminar titled “Inside Cuba Business Briefing.”

The firm declined to answer questions about the briefing or new trade regulations, but U.S.-Cuba Chamber of Commerce President Margaret Pulles Machado said the group had “no new information at this time regarding upcoming revisions to U.S.-Cuba policies,” but hoped the presence of “a representative from the State Department and Treasury Office of Foreign Assets Control (OFAC) at our briefing on Oct. 27” would “address this and other issues.”

Mr. Morales said that while The Havana Consulting Group did not “really know the reasons why the announcement of these measures has been delayed … we consider that there is a high probability that the announcement will be made before Oct. 27.”

The issue of trade regulations, however, “belongs to [Treasury’s] OFAC and they are the ones who decide where and when they are going to make the announcement.

President of the New York-based U.S.-Cuba Trade and Economic Council John Kavulich said the new rules “were expected by now,” but “OFAC is overwhelmed with other issues.”

In a lengthy post on his www.cubatrade.org website, Mr. Kavulich wrote “The Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury, the Bureau of Industry and Security (BIS) of the United States Department of Commerce, and the United States Department of State are (were) expected to issue regulations and lists of entities within the Republic of Cuba that are controlled (owned/operated) by the Revolutionary Armed Forces (FAR) of the Republic of Cuba.

“These entities would be prohibited from engagement,” he said, but noted “OFAC and BIS did issue statements suggesting that existing operational agreements with FAR-controlled entities by airlines, cruise lines, tour operators and travel agents would be permitted to continue.

“Principally, the reasons are what the Obama Administration and the Castro Administration failed to implement relating to commerce. He said not enought had been authorized by either government, “which created a landscape for the Trump administration to be disruptive.”

This has caused “continuing bilateral ambiguity,” Mr. Kavulich said, calling it “exceedingly negative in all respects,” especially in regard to bilateral commerce, and said it would “likely continue, unabated, through Feb. 24 next year, when Cuban President Raul Castro is scheduled to retire.”

He pointed out that the Four Points Sheraton Havana is managed by Starwood Hotels and Resorts Worldwide, a subsidiary of Marriott International, but owned by FAR.

Marriott International Director of Public Relations and Social Media for the Caribbean & Latin America Kerstin Sachle told the Compass the company was “not aware that new rules have been released by the administration and therefore cannot comment on the impact on our operations.”

Mr. Kavulich said Havana’s Minister of Foreign Affairs Bruno Rodriguez met U.S. Secretary of State Rex Tillerson in Washington on Sept. 27, and Josefina de la Caridad Vidal Ferreiro, Cuba’s director general of the Department of the United States had “bilateral meetings” at the State Department on Sept. 19.

“There is no published information as to meetings with representatives of the United States business community, no published information as to meetings with representatives of organizations, no published information as to meetings with officials of state governments, and no published information as to meetings with Members of Congress,” Mr. Kavulich said.